national Bank NA - Stocktrades Canada

hi guys,

people typically focus on the top 5 big banks, although you thankfully often go outside that list. any thoughts about National Bank?
as it expands outside Quebec. p/e 12, eps 7.43, w annual dividend growth pace of 6%. Any reason to prefer it over TD or RY ?

Thanks

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Asked on June 19, 2021 1:54 pm

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HI JJ,

National Bank is a solid option. It has been the best performing bank of the past handful of years as its growth has outpaced its peers. My only hesitation with it at these levels - it is more expensive compared to TD/RY on historical basis and it has the lowest CET1 ratio of the Big Six. Not that its bad, still well above the 10.5% target, but it may mean lower dividend growth.

It is however, not one I would be against as it may continue to outperform given its expected growth rates (while slowing) are still higher than TD/RY. This is likely a function of its size as compared to its much larger peers.

I like NA and have no qualms about taking a long-term position here.

Mat

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Posted by Mathieu Litalien

Answered on June 21, 2021 7:49 am

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